Property buyers in Dubai face a hike in upfront costs from 1 February 2025.
A mortgage deal will no longer allow the finance of the 4% Dubai Land Department (DLD) fees and 2% brokerage fees through their home loan.
This change means investors and buyers must be prepared to cover these costs out of pocket, leading to higher upfront payments.
For example, an expat purchasing a property worth AED 1m would need AED 200,000 (20%) as a deposit, plus AED 60,000 for fees, totaling AED 260,000 upfront. The fee for any property above AED 5m is 30%.
Off-plan properties with developer incentives may become more popular. Developers often offer flexible payment plans and lower initial costs. In some cases, developers waive the DLD fees partially or entirely.
Requiring buyers to bear the upfront costs of property transactions is meant to reduce speculative activity and ensure a more sustainable market structure.
Also, the Central Bank has a mortgage cap for first-time buyers, allowing them to borrow up to seven times their salary.
